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Informist, Monday, Jun. 8, 2026

--FADA: May total vehicle retail sales 2.53 mln units
--FADA: May total vehicle retail sales 2.53 mln units, up 9.6% on year
--FADA: May passenger vehicle retail sales 402,591 units, up 23.3% on year
--FADA: May 2-wheeler retail sales 1.84 mln units, up 7.5% on year
--FADA: May CV retail sales 83,823 units, up 5.3% on year
--FADA: May 3-wheeler retail sales 111,526 units, up 3.6% on year
--FADA: May tractor retail sales 83,092 units, up 11.2% on year
--FADA: Next three months appear to be "cautiously optimistic"
--FADA: PV cos must maintain disciplined despatches in seasonally softer Jun
--FADA: Apr-May total vehicle retail sales 5.25 mln units, up 11.6% on year
 

MUMBAI – The retail sales of automobiles in India grew almost 10% on year in May to 2.53 million units despite multiple hikes in prices of petrol, diesel, and compressed natural gas and heatwave conditions, the Federation of Automobile Dealers Association said Monday. However, sales fell nearly 7% on a month-on-month basis due to a seasonal lull and a late monsoon, the industry body said in a release.

Dealerships sold 1.84 million two-wheelers in May, up a shade over 7% on year but down by a similar margin on month. "Dealers attributed the steady commuter and rural participation to marriage-season buying and continued affordability under the GST 2.0 framework, even as heatwave conditions dampened showroom walk-ins in several markets and selective model-wise supply gaps tempered the momentum," FADA President C. S. Vigneshwar said. The share of electric two-wheelers sold climbed to 9.25% from 6.11% a year ago amid the multiple hikes in petrol prices. 

Passenger vehicles ruled the roost in retail sales growth in May. Their retail sales grew 23% on-year but fell 6% on-month to 402,591 units. "Dealers pointed to a small-car revival co-existing with a sustained SUV mix, healthy booking pipelines and refreshed product launches, alongside a richer alternative-powertrain mix in which CNG share rose to 23.34% and EV share improved to 6.63%," Vigneshwar said.

Sales of passenger vehicles in rural areas grew 30%, while in urban areas they improved by almost 19%. Inventories of passenger vehicles at dealerships inched up to 31-33 days as of May 31, from 28-30 days as of Apr. 30. This remains well above FADA's recommended inventory level of 21 days. "We urge PV OEMs (original equipment manufacturers) to maintain disciplined dispatches through the seasonally softer June window so that channel stocks stay closely aligned with retail demand," Vigneshwar said.  

Retail sales of three-wheelers in India grew 4% year-on-year and 1% month-on-month to 111,526 units in May. Electric passenger rickshaws, which account for a significant share of this segment, saw a sharp year-on-year decline in sales, while conventional passenger rickshaws, which contribute the most to this segment, saw robust growth. Tractor sales in May stood at 83,092 units, up 11% on-year and almost 6% on-month.

Retail sales of commercial vehicles grew 5% on year but fell a shade over 18% on month to 83,823 units in May. "Dealers cited steady freight activity, e-commerce-linked movement and replacement demand as the principal supports, while flagging elongated financing turnaround time, higher freight and insurance costs linked to the West Asia situation, and a degree of buyer caution as monitorables," Vigneshwar said. 

In Apr-May, retail sales of automobiles in India grew almost 12% on-year to 5.25 million units. Almost all segments reported growth during this period, except for wheeled construction equipment.

OUTLOOK

Just over half of the dealerships surveyed by FADA expect retail sales to grow in June, while almost 40% anticipate a flat market. "With the southwest monsoon having set in over Kerala on 4th June and beginning its northward advance, demand expectations are anchored in the progress of the monsoon, early kharif sowing preparation and the tail of the marriage season," FADA said. 

While the two-wheeler segment is expected to gain from improved rural cashflows and a shift in enquiries towards fuel-efficient electric vehicles in June, passenger vehicles are likely to draw on healthy booking pipelines, especially in the electric category. "Overall, the outlook for June'26 appears measured but cautiously optimistic, with monsoon progress and rural cashflows expected to provide the structural support even as near-term cost pressures persist," FADA said.

For Jun-Aug, 59% of the dealerships surveyed by FADA expect retail sales to grow. Dealers expect the seasonal lull to give way to a stronger rural income cycle after the kharif sowing gathers pace. "Overall, the next three months appear to be cautiously optimistic — with a tad below normal monsoon, the firm 7.7% FY26 GDP print and broad policy continuity providing a supportive backdrop, the industry looks set to move from a seasonally soft patch towards a firmer second-quarter footing," FADA said.  End

Reported by Anand JC

Edited by Saji George Titus

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